News Flash: Analysts Just Made A Meaningful Upgrade To Their Imperial Oil Limited (TSE:IMO) Forecasts

Celebrations may be in order for Imperial Oil Limited (TSE:IMO) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The analysts have sharply increased their revenue numbers, with a view that Imperial Oil will make substantially more sales than they'd previously expected.

Following the upgrade, the most recent consensus for Imperial Oil from its four analysts is for revenues of CA$66b in 2022 which, if met, would be a substantial 26% increase on its sales over the past 12 months. Prior to the latest estimates, the analysts were forecasting revenues of CA$59b in 2022. It looks like there's been a clear increase in optimism around Imperial Oil, given the nice gain to revenue forecasts.

View our latest analysis for Imperial Oil

We'd point out that there was no major changes to their price target of CA$74.76, suggesting the latest estimates were not enough to shift their view on the value of the business. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Imperial Oil at CA$94.00 per share, while the most bearish prices it at CA$58.00. This shows there is still some diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Imperial Oil's past performance and to peers in the same industry. The analysts are definitely expecting Imperial Oil's growth to accelerate, with the forecast 60% annualised growth to the end of 2022 ranking favourably alongside historical growth of 5.1% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 0.04% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Imperial Oil to grow faster than the wider industry.

The Bottom Line

The most important thing to take away from this upgrade is that analysts lifted their revenue estimates for this year. Analysts also expect revenues to grow faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Imperial Oil.

Unsatisfied? At least one of Imperial Oil's four analysts has provided estimates out to 2024, which can be seen for free on our platform here.

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.